The MacNeil/Lehrer NewsHour

Intro

JIM LEHRER: Good evening. In the news today, the airliner hijacking ended in Iran with everyone safe. The number of Americans below the poverty level has increased another 868,000 and another .2 of a percentage point. The postmaster general said he will fire the nation's 600,000 postal workers if they strike. And the stock market closed up a whopping 31.47 points, the biggest one-day gain in nearly two years. Robert MacNeil is away tonight; Charlayne Hunter-Gault is in New York. Charlayne?

CHARLAYNE HUNTER-GAULT: Pursuing some of the main stories in the news tonight, we have help from Washington Post columnist Don Oberdorfer, who has a few informed opinions about the U.S.-Russians standoff on space weapons talks and whether they'll ever be held. In the wake of today's NRC decision, Kwame Holman explains why Diablo Canyon is so crucial and so controversial. On an equally controversial new broadcasting rule, FCC Chairman Mark Fowler squares off with Jack Valenti of the Motion Picture Association over how many radio and TV stations an owner may hold. And from the Olympic scene, special correspondent Larry Merchant tells us why atheletes use drugs outlawed by the U.S. Olympic Committee and what's being done about it.

LEHRER: The Air France hijacking ended in Iran this morning with all 50 hostages safe and with a surrender of the three armed terrorists who had commandeered the airliner on a flight from Frankfurt to Paris 48 hours before. At the airport in Teheran, the last chapter of the story began when one of the hijackers came down the boarding stairway and motioned to the hostages to follow him. The 44 passengers and two pilots assembled beside the Boeing 727 jetliner, perhaps wondering if the hijackers would carry out their threat to kill some of them if France would not release five prisoners. Then the hijackers directed them all to trot down the runway for a distance of about 200 yards from the plane. Those watching from the control tower knew the hijackers had already placed explosives somewhere on the plane. The explosion blew the roof out of the cockpit and started a small fire, which was put out after a few minutes. The hijackers then surrendered, and all the passengers were free, unharmed. Teheran was the fourth stop on a hijack trip that passed through Geneva, Beirut and Cyprus.

Charlayne?

HUNTER-GAULT: In this country the stock market today had its biggest one-day gain in nearly two years, soaring for the second day in a row. A record 173 million shares were traded as the Dow Jones average of 30 industrial stocks rose 31.47 points to close the day at 1166.08. Analysts attributed the rise to further reports that the recovery is slowing, thus relieving pressure on interest rates and inflation. For example, the nation's three leading retailers today reported mixed results for July compared to a year ago, when sales were strongly up from the recession. And in a not totally unrelated story, Postmaster General William Bolger warned the nation's 600,000 unionized postal workers that he will fire them if they stage either wildcat or nationwide strikes. Negotiations on a contract between the postal service and its two major unions broke off on July 20th with the government insisting on a three-year wage freeze for current employees and a 23% pay cut for newly hired workers. A spokesman for the Postal Workers Union called Bolger a "tyrant," his remarks "provocative," and said that while a strike was a distinct possibility, they would not be provoked.

Jim?

LEHRER: The poverty rate for the United States has gone up again. The Census Bureau said today 15.2% of all Americans in 1983 fell below the official poverty level. That's an increase from 15% in 1982 and translates into 868,000 more people, 35,266,000 in all. The official poverty definition in 1983 was an income of $10,178 for a family of four. It should come as no surprise that Democratic leaders immediately seized on the new figures as evidence of Reagan administration wrongdoing. House Speaker Thomas O'Neill called the statistics "the smoking gun of Reagan unfairness."

Rep. THOMAS P. O'NEILL, Speaker of the House: Fact number one under Reagan: the poor are getting poorer.For years we fought to get the poverty level down in this country. By the 1970s we had gotten the level down to 11%. You must remember that in 1936 the rate of poverty in America was approximately 50%. In 1982, when Reagan policies sent the policy [sic] rate up to 15%, the administration said that the trend would be dramatically reversed in 1983. Today we learned just the opposite has happened.

LEHRER: And Democratic presidential candidate Walter Mondale went on the offensive today as well. Campaigning in Texas, Mondale said the Reagan administration was building up a secret deficit that threatens to undermine the future. The Mondale-Ferraro ticket was campaigning in Houston, where the visited a community college. Mondale said he wants to make the U.S. international trade deficit a key issue in the fall campaign. That's an issue that may not be discussed in a debate between vice presidential candidates, however. Reagan administration spokesman Larry Speakes said today the White House might not agree to a Bush-Ferraro debate. Speakes said the final decision on the debates will come after discussions are held with the Democrats.

Charlayne?

HUNTER-GAULT: Politics also played a role in foreign affairs matters today as the Democratic-controlled House ignored pleas by Republicans and voted to deny aid to Nicaraguan rebels. The vote was 294-118. Republican leader Robert Michel warned that the move forces the United States to be either an "interventionist bully" or an "isolationist wimp." But the Democrats for the fourth time this year denied the funds and also tightened restrictions on the ability of the CIA and other intelligence agencies to shift funds secretly from one account to another. Reacting from Santa Barbara, where the President is vacationing, White House spokesman Larry Speakes said the administration will continue working for full funding. Meanwhile, Nicaraguan officials have reportedly called for direct talks between junta chief Daniel Ortega and President Reagan. According to the official Nicaraguan news agency, ANN, the proposals stem from talks being held in Mexico between U.S. Special Envoy for Central America Henry Schlaudeman and Nicaraguan Deputy Foreign Minister Hugo Tinoko.

Meanwhile, in neighboring El Salvador, leftist guerrillas killed a bank guard and claimed to have seized 127 hostages in what military authorities there called a bungled bank robbery. A local director of the International Red Cross is heading a team of negotiators trying to find a peaceful solution to the standoff. Jim? Weapons Talks -- Standoff in Space

LEHRER: Once again there were harsh words from Moscow about the U.S. position on space weapons talks. The Novosti news agency charged Reagan administration National Security Advisor Robert McFarlane with misleading the public. That's because yesterday he said the Soviets were misrepresenting the U.S. position on the talks. The news agency said the U.S. was reluctant to enter the talks, first suggested on June 29th and scheduled for September. But the Reagan administration has said it accepts the idea but wants to negotiate about more than just space weapons, and that position has been rejected by Moscow, and on and on back and forth it has gone. This morning, Washington Post diplomatic correspondent Don Oberdorfer described it as a dialogue of the deaf, and we ask him about that now.

Dialogue of the deaf -- what do you mean, Don?

DON OBERDORFER: Well, as you said, on June 29th the Russians surprised everybody by proposing these talks with the Reagan administration. The administration the same day within hours said yes, and ever since the Moscow's been saying "No, you don't, you're not saying yes." The administration is saying "Yes, we are saying yes." And they've been going back and forth with public comments against each other, culminating in yesterday's series of two comments, which make it seem very very unlikely that these talks are going to get off the ground. Certainly not in September, and maybe not for a long time.

LEHRER: Was it a serious proposal from the beginning, or is there any way to know?

Mr. OBERDORFER: Well, I don't think there's any way to know. The thing that raised people's apprehensions here was that Ambassador Dobrynin, the Soviet ambassador in Washington, came to see Secretary of State Shultz, presented him with the proposal, and then within several hours later the Russians suddenly announced it. Dobrynin said nothing about there being any public announcement. Before the day was out the administration responded, and within a couple of days the Soviets started attacking. So right from the start, if they were really serious, there was a feeling they would have worked it out diplomatically instead of having all this public back-and-forth.

LEHRER: Well, the U.S. position, which as I understand it, it kind of want through a few modifications during the last 33 days as well, but they were willing to talk about space weapons but they'd like to talk about other things as well. Was that something the Soviets just seized on, or was that a real problem for them?

Mr. OBERDORFER: Well, I think it's a real problem, but they also seized upon it. This, I think, is one of the most bizarre episodes in recent decades between the two nuclear superpowers, and it's very hard to know what the Soviets really had in mind. It sounds like it might have been some kind of compromised decision in Moscow, or a split decision, because it's not characteristic of the Soviets, not in recent decades anyway, to throw up a proposal and as soon as the other guy starts to reach for it, you grab it back again. So it's a very very curious episode. The Soviets made some conditions on it which the Reagan administration did not like. The fact of the matter is, before this came up they weren't really interested in talking about space weapons -- the administration was not. The Soviets have been asking to do this for over a year, to have a negotiation regarding space weapons. The administration was not interested. Then all of a sudden the Soviets named a specific place, Vienna, and a specific time, September, which of course nobody forgot would be right in the middle of the American presidential campaign. The administration grabbed it, and as they -- the very hand was reaching out to grab it, the Soviets pulled it back.

LEHRER: Well, you mentioned the presidential election. How can you factor that in, or how would you factor it in?

Mr. OBERDORFER: The Soviet leaders know very well that there's an election going on in this country. Now, you can say how does that affect their thinking? One line of thought was that they want these negotiations, and so it would be better for them to offer them and start them now, assuming Reagan were to be reelected, than to wait after he was reelected -- they'd be in a better position. That was the original line of thinking. But if that was their intention, they did not play it that way, because instead of giving Reagan a help or favor, it -- the way it all played out was just the opposite, or seemed to be intended to do the opposite. The Soviet diplomats apparently told United States diplomats at some point that "You should understand that we understand that this will help the President." What did that mean? How do they analyze American politics? We really don't know. I mean it must be some kind of strange view from Moscow.

LEHRER: Well, there is no question that if these talks were to come off in September, they would help the President.

Mr. OBERDORFER: Well, I don't think there's any question. There is a line of thinking in the more deep-dyed parts of the administration that the Soviets really intended to start the talks and then walk out, then try to embarrass the President. But that's -- that would not -- again, that would not be the kind of thing that one would expect based on past negotiating behavior.

LEHRER: Is there any question in your mind that these things are dead now, that they won't be meeting in Vienna in September about space weapons?

Mr. OBERDORFER: Well, I once had a wonderful managing editor who told me, "Never report the plane is down until you have your hand on the wing." But it certainly is hard to see how they could now spring back to life in time for September. After what was said yesterday, the national security advisor of the United States said that the Soviets did not seem to be serious and the constant attacks from Moscow every time the U.S. puts forth a new position. I think it's very very unlikely, but who knows?

LEHRER: Who knows? Assuming that these talks don't come off, what is going to be the end result of this little 34 days of back-and-forth of rhetoric? I mean are we in worse shape vis-a-vis relations with the Soviet Union?

Mr. OBERDORFER: Well, I would say in my own view there are two or three end results. One is, I think it has focused attention on this area of space weapons, weapons in space. And if that was the Soviet intention, or part of it, perhaps it has accomplished that. I personally think that's a good thing. I think that we have been moving toward a battlefield in space, these two countries, of a very dangerous sort, and that people ought to stop and think what is going to happen here, and some attention put on that area is a good thing. The second thing it's done is kind of demonstrated the very poor state of U.S.-Soviet relations. When relations were better, the two countries wouldn't be acting this way. The Russians wouldn't be issuing a press releases every few days attacking us about our position, and the negotiations would be taking place in a more serious way. And I think this demonstrates just how serious the bad relations are between Moscow and Washington.

LEHRER: And there was a third point?

Mr. OBERDORFER: No.

LEHRER: There wasn't?

Mr. OBERDORFER: There wasn't.

LEHRER: All right. Well, Don, thank you very much for being with us.

Mr. OBERDORFER: Glad to be here.

LEHRER: Charlayne?

HUNTER-GAULT: In Israel, efforts to form a government of national unity continued today with opposition Labor leader Shimon Peres gaining a key endorsement to head it. Ezer Weizman, leader of the small but influential Yahad, or Together Party, threw his support to Peres as the Israeli press speculated that Peres was also likely to be the first choice of President Chaim Herzog. But the president has given no indication of his choice. In keeping with his mandate, Mr. Herzog has been attempting to form a new government for his country since neither the Labor Party, headed by Mr. Peres, nor the Likud Party, headed by current Prime Minister Yitzhak Shamir, gained a majority in the July 23rd election.

In Buenos Aires, Argentina, former military president Jorge Videla was being held at an army base, facing charges that he ordered the kidnapping, torture and murder of hundreds and maybe thousands of Argentines. The charges were brought by the eight-month-old civilian government of President Raul Alfonsin. He pledged during his election campaign to punish those responsible for what the armed forces called the dirty war against citizens regarded as leftist terrorists.

Jim?

LEHRER: Still to come on the NewsHour Tonight, the debate over radio and TV station ownership between FCC Chairman Mark Fowler and movie industry spokesman Jack Valenti, and a report from Larry Merchant in Los Angeles on drug use by Olympic athletes.

[Video postcard -- Apache Mountain, Arizona] Diablo Canyon Nuclear Power Plant

HUNTER-GAULT: After a long battle, the Nuclear Regulatory Commission voted three to one today to grant a full-power license to the Diablo Canyon nuclear power plant in California.That means the plant can now operate at 100% of capacity. Pacific Gas & Electric, the utility which owns the plant, said it had hoped to have the first reactor producing electricity within 100 days. NRC Chairman Nunzio Palladino delayed the effective date of the NRC's decision for two weeks to give opponents of the plan an opportunity to challenge the NRC's ruling in court. Here's how some of the commissioners explained their decision today.

NUNZIO PALLADINO, chairman, Nuclear Regulatory Commission: I believe that the procedures we have adopted for screening and evaluating the many allegations involving Diablo Canyon provide reasonable assurance that the plant is not beset by safety deficiencies that would endanger the health and safety of the public in the vicinity of the plant.

JAMES ASSELSTINE, Nuclear Regulatory Commission: My principal concern has to do with the treatment of the complicating effects of earthquakes on emergency planning, and that decision, together with my remaining doubts on the seismic design quality assurance area, lead me to conclude that I must vote against full-power operation at this time.

THOMAS ROBERTS, Nuclear Regulatory Commission: The NRC has gone well beyond the requirements of NRC procedures for public participation and has been responsive to public concerns. A record number of allegations from the public have been reviewed and analyzed. Those few which are found to have technical merit have been appropriately acted upon. Now, after exhausted and comprehensive review, the NRR [office of Nuclear Reactor Regulation] staff and NRC region five have concluded that this plan is ready in all respects for full-power operation. I personally believe that this plant is ready to begin power ascension and should be issued a license.

HUNTER-GAULT: The decision to bring Diablo Canyon fully on line is considered a significant victory for the nuclear power industry, which has suffered numerous setbacks over the past few years. In March we broadcast a report on the controversy surrounding Diablo Canyon. Here's an updated version of that segment with correspondent Kwame Holman.

KWAME HOLMAN [voice-over]: The long and tangled history of the Diablo Canyon nuclear power plant began over 17 years ago, when the Pacific Gas & Electric Company, the nation's largest investor-owned public utility, started construction. Since then, legal challenges and engineering errors repeatedly delayed completion of the plant. The first construction delay came in 1973 when PG&E discovered the Hosgri earthquake fault near the plant. Though the original plant design included earthquake fortifications, the Hosgri fault was not considered. The Nuclear Regulatory Commission told PG&E to modify the plant to withstand a stronger earthquake. PG&E chairman Fred Mielke.

FRED MIELKE, chairman, Pacific Gas & Electric Company: We finally decided it should be -- the plant should be redesigned to handle a 7.5 Richter scale earthquake. Although that was always considered an outlandish possibility that it could ever generate that kind of force, we nevertheless designed for it.

HOLMAN [voice-over]: Despite PG&E's corrections for a stronger earthquake, opponents still believe that the plant was not safe and staged this 1978 demonstration to stop further construction.

DEMONSTRATOR: If there was an earthquake, if there was an accident, a leakage of radioactive materials, it would affect everybody because of the ocean currents, the winds, you know, the water supply -- everything would be contaminated.

HOLMAN [voice-over]: One of the first groups to form was Mothers for Peace, followed by the Abalone Alliance, a group devoted primarily to nonviolent direct action. Nancy Culver lives in San Luis Obispo. She was one of the earliest opponents of Diablo Canyon.

NANCY CULVER, Mothers for Peace: There's a standing joke in California that says if you want to locate an active earthquake fault, ask PG&E to site a nuclear power plant. They tried several other locations before they settled on Diablo Canyon, each of them with serious earthquake problems.

HOLMAN [voice-over]: In 1981, opponents staged yet another demonstration, fearing the imminent licensing of the plant by the NRC. The license was awarded but then revoked days later, not because of the opposition's blockade but because of a huge design error discovered by PG&E engineers. Blueprints for the Unit One reactor had been used for the Unit Two ractor, and as a result earthquake supports had been put in backwards. The NRC immediately revoked PG&E's license and the error proved to be one of the costliest mistakes in the history of the industry. John Martin heads the NRC regional office that regulates Diablo Canyon.

JOHN MARTIN, regional director, Nuclear Regulatory Commission: This is a case where the NRC does not check all of the calculations and all of the design. It should have been discovered much, much much earlier.

HOLMAN [voice-over]: Over the past two and a half years, PG&E has spent millions of dollars trying to correct the design error. But the company says it would have finished those corrections sooner had it not been for the opposition.

Mr. MIELKE: If the plant did not have opposition from dedicated opponents to drag out the whole process of this re-review, which I think otherwise could have been done in six months' time, it would have cost less.

Ms. CULVER: The vast majority of the delays have been caused by PG&E's bad management, PG&E's errors. For two and a half years they've been trying to fix the fixes that they did wrong the first time at that plant. So I think that PG&E is pointing the finger when in fact they should be pointing it at themselves.

HOLMAN [voice-over]: Despite the objections of critics like Nancy Culver, last April the NRC granted Diablo Canyon a license to test the plant at low power. But concern about the construction of Diablo Canyon continued, and charges came from people inside the plant, workers who actually helped build it. One early whistle-blower was Harold Hudson, a quality assurance inspector.

HAROLD HUDSON, PG&E employee: Yes, I think there's enough evidence right now to suggest that there has been a significant breakdown in the quality assurance program. The program does not meet the code of federal regulations.

HOLMAN: Did you see anything at the plant that could create a major safety problem?

Mr. HUDSON: The major areas was welding. I identified, as an internal auditor and later on my own time, what I felt were significant quality assurance breakdowns in welding. This involved unqualified welders, unqualified welding procedures, using welding procedures that were not relevant to the type work being performed. The result in my opinion is we have a powerhouse out there that quality assurance cannot really assure that the plant is safe and ready to operate.

Mr. MIELKE: I can reject out of hand that there is widespread poor quality in the construction of that plant. Absolutely, flat out.

HOLMAN [voice-over]: The NRC appears to agree with PG&E. Earlier this week the commission reported that none of the nearly 1,400 allegations of problems amounted to an undue health or safety risk to the public. Once again Diablo Canyon is poised for full startup, and once again local residents are worried.

Ms. CULVER: I think that everyone in this country needs to care about how the NRC performs in the Diablo Canyon case. If they can license this plant, they will license anything.

HUNTER-GAULT: Today's licensing of Diablo Canyon is the second controversial NRC decision this week.On Tuesday the commission also granted a full-power license to Grand Gulf, the nation's largest nuclear power plant. Like Diablo Canyon, critics have charged that Grand Gulf, located in rural Mississippi, is also unsafe. Controversy surrounding the NRC is likely to continue. Next month the commission is expected to decide whether to allow the startup of an undamaged nuclear reactor at the Three Mile Island nuclear power plant in Pennsylvania.

Jim? Broadcast Deregulation

LEHRER: Today the Senate Appropriations Committee moved toward quashing 12-12-12, the new ruling of the Federal Communications Commission on ownership of radio and television stations. The current rule restricts any one person or company to owning seven in various categories. The new one would raise it to 12, and in 1990 to no restrictions at all. The Motion Picture Association of America, led by its president, Jack Valenti, has lobbied hard to kill the new rule, prompting FCC Chairman Mark Fowler to charge Valenti with using the big-lie technique, prompting Valenti in turn to say Fowler's claims for the new rule are slightly foolish, prompting us to invite both to be here tonight.

Mr. Chairman, does what the Senate Appropriations Committee is on the verge of doing mean your new rule is in serious trouble?

MARK FOWLER: Well, it's certainly not a plus, Jim, and I want to congratulate Jack for a victory, obviously. But I don't think it's over yet. I think what we have to do is educate the Congress as to why what we're doing is better able to support free television, which I think is endangered as more and more services, particularly recent movies and sports, go to pay television. And we want to be able to let some of these group owners get bigger so they can compete with the nets and be able to afford to purchase this programming and maintain free TV.

LEHRER: Let's move directly to the heat here. What is it that Jack Velenti has said that is a big lie?

Mr. FOWLER: Jack's saying that this has to do with network dominance. It has very little to do with network dominance, and I can explain why, but I'll let Jack talk.

LEHRER: Mr. Valenti?

JACK VALENTI: Well, first, I honor the chairman for his energy and his commitment. He's been an aggressive chairman. And I must say, I'm in favor of many of the things he's doing in trying to deregulate. But when you deregulate, you can't do it with an axe; you've got to handle it with a delicate hand. The issue is solely network domination. As far as I'm concerned -- and I don't speak for the Senate, and by the way, I'm not to be congratulated; I didn't do very much at all. The Senate of the United States was terribly concerned about the singular issue which is at stake here, and that is a concentration of power of television in a very few hands. That's what the issue is.

LEHRER: All right. Now, lay it out from your perspective, how 12-12-12 would increase network domination rather than decrease it, which --

Mr. VALENTI: I am for deregulation of radio stations. I think that's wonderful. I'm delighted to have the group owners -- Metromedia, Capital Cities, Taft Broadcasting -- buy as many stations as they want. What is at hazard here, though, is to allow three giant corporations who today control 100% of all prime-time programming, who have some 619 affiliates is this country, 78% of all the commercial television stations in the country, who control 100% of all nationally delivered news, morning and evening -- and who with this 12-12-12 could now reach out to some 35% of all television households just through their O&Os, which takes them into local news, and because of the extension of cable could reach to 50% of each of their O&Os reaching the nation's households.

LEHRER: Owned and operated --

Mr. VALENTI: Owned and operated. And finally, after 1990, to have the total limitless power in the marketplace, to me is a public policy question that must be addressed by the Congress.

Mr. FOWLER: Jim, I agree that the networks have great reach, and they have that reach as a result of their affiliates. Each programs to about 220 affiliates. Now, whether or not CBS buys one of their affiliates or not, that CBS programming is going to be shown over that station. It doesn't matter. And so this rule, which also permits networks to go up to 12 from seven, doesn't in any way increase so-called network reach. I agree that that is an issue, but that is not related to what we're doing here. It doesn't change anything if a network buys one of its own affiliates. The programming is still there whether it does or not. What Jack doesn't like is if groups get bigger, like Metromedia and others, they have greater power when they bargain with the Hollywood producers as to what they pay for the programs they purchase. That's what his problem is.

Mr. VALENTI: I just said to the chairman --

LEHRER: So it's a money deal for you.

Mr. VALENTI: No, no, no. Mr. Chairman -- if I may, Mr Fowler, please -- I am for group owners having purchase as many stations as they want.I think they will have some competition to the networks. What we are against is network extension of this total power. If you wanted to see power at its most ominous, you just have to watch the Democratic convention as you will watch the Republican convention, where three men, unseen, unknown to the American public, unelected to anything, decided who went on the air and who did not. And that's power.

Mr. FOWLER: That's not right, because there were a lot of people involved in that decision, including the networks' 220 affiliates. The fact is that the nets have the resources, and how wonderful it is, to be able to bring the convention into American homes. They ought to be praised for it -- it is a money-losing proposition -- instead of condemned, and it was not made by three men. That decision on the hours of the convention coverage was a multiperson decision.

LEHRER: You think then for the movie industry and Jack Valenti this is protecting themselves from a financial loss.

Mr. FOWLER: Well, what happened in the Senate today was they said nobody can have more than seven, including these group owners. And I didn't see the Motion Picture Producers Association getting in there and saying "Oh, no, just limit it to the nets." What happened was they limited all of the groups, so nobody can get larger. And in fact what that will do is force these very small groups to continue to have to rely on the nets for their programming. If we can let some of these groups get larger, then we're going to have true competition with the nets. But there's no reason in the meantime to discriminate either against the nets or the groups, and let them all get bigger. And I think we're going to see more and better news and public affairs programming, and less, perhaps, Hollywood shows. But Jack doesn't like that.

Mr. VALENTI: Let me say again, Mr. Chairman, please, I honor you and I respect you and I know that you wouldn't -- you're not distorting my remark. But I say again, we are for the group owners buying more stations. We are not against that. But I cannot tell the Senate of the United States what to do any more than Chairman Fowler can.

LEHRER: Excuse me. You would agree to a restriction that would just restrict CBS, ABC and NBC from owning more stations?

Mr. VALENTI: Absolutely. Because, Jim, that is where power dominion lies. The concentration of power.

Mr. FOWLER: Would you be willing to make that as an amendment, that it would deal only with the nets?

Mr. VALENTI: Oh sure.

Mr. FOWLER: Because that's not what you did today.

Mr. VALENTI: I didn't do anything, Mr. Chairman. I am not a member of the United States Senate. I was not in the hearing room. And I don't vote for United States senators. Anybody who thinks that either Mark Fowler or myself can tell a United States senator how to vote is indulging in fantasy.

Mr. FOWLER: I'm talking about the lobbying effort, and you know as well as I do that you devoted considerable resources to lobbying. And all I'm saying, if you felt that way, why didn't you say today "Oh no, we want the group's to get bigger. Simply limit it to the nets." You didn't do that.

Mr. VALENTI: Let's get back to the essential question. I said now that we are very much in favor of just restricting the networks. And even, I must say that we would look with favor -- we meaning public interest groups and programmers and Westinghouse and Turner Broadcasting and all the other people who are terribly upset by this -- we would be willing to look at Commissioner Dawson's plan of limit -- let the networks buy a few more stations, but limit their reach to 25% forever, not sunset it, and that would give them a few more stations but not give them limit --

LEHRER: Twenty-five percent of what?

Mr. VALENTI: Twenty-five percent of TV households. Today the networks' owned and operated stations reach approximately 20.8% of the television households.

LEHRER: Because they're in the big cities. New York, Los Angeles --

Mr. VALENTI: They're in the big cities. They have the powerful stations.

Mr. FOWLER: Of course, through their affiliates they reach 98% of the TV households. And a lot of people would say that --

Mr. VALENTI: We're only taking about owned and operated here, though.

Mr. FOWLER: Yeah, I understand, but a lot of people would say that the nets do a very good job both in their national programming and in the local programming that they have on local affiliates.And the record shows in fact that the group powers, including the nets, put more higher-quality news and public affiars programs on in the markets they're in than do others, generally speaking. So there's no reason not to let those same benefits accrue to the nets as anyone else. And the dominance issue again is not helped or deterred by what we did in this order. Again, Jack is using, and I will repeat, the big-lie technique. He's telling a lot of little lies, and they all add up, I'm afraid, Jack, to a big lie.

Mr. VALENTI: Mr. Chairman, I would never accuse you of being a liar, and I know that you don't really mean that, because I count you to be a sincere man, saying what you believe to be ture.

Mr. FOWLER: When you change your facts --

Mr. VALENTI: I would hope you would accord me the same respect.

Mr. FOWLER: I will, but I want -- I insist that you have your right to your own opinion, but not to your own set of facts, Jack.

Mr. VALENTI: My facts are these.

Mr. FOWLER: And you are mischaracterizing what the commission did, and that's important to point out.

Mr. VALENTI: The commission is allowing networks to buy up to 12 VHF stations and in six years will sunset the rules so that thenetworks will have the limitless power to buy as many stations as they want. All I'm suggesting to you is, if I were a public official, I think it's a serious and tormenting public policy question to allow three networks to control the most pervasive force in this country, which is television.

LEHRER: He's talking to you, Mr. Chairman.

Mr. FOWLER: The thing I would say is, I could talk about the national issue of the big Hollywood producers and all of the pornographic movies that they label PG that I take my daughter to and say that that's an issue. That's an important issue, but that is not what is involved here. The big Hollywood producers don't like competition. They don't want any of the groups to get larger. They don't want any of the nets to have any more bargaining power with them when they buy programming from Hollywood, and that is all it is.It has nothing to do with dominance. The record indicates that this won't increase network dominance -- that is not an issue here. It's dollars and cents with Mr. Valenti and the Hollywood big-eight producers.

Mr. VALENTI: I'm really -- again, I honor you, Mr. Chairman, but I am distressed that you would characterize it that way, because you know in your heart that's not so. That's what 18 senators voted for today. They were all concerned about dominance and concentration. Senator Goldwater is going to have hearings on this in the Commerce Committee. The Judiciary Committee is holding hearings in the Senate on September 11th. The House and the Senate both will be holding hearings next year.

LEHRER: And you're going to fight all the way, right, Mr. Chairman?

Mr. FOWLER: I think if we can educate the Congress and show why the American people will be better off, we're going to see better programming, more programming, and preserve free television because of the threat of pay television -- that is an important point.

LEHRER: Thus tonight the fortunate people who were watching this program heard both sides of the argument.

Mr. FOWLER: Yes, indeed.

LEHRER: Thanks to both of you for being here. Charlayne?

HUNTER-GAULT: In London, little Hollie Roffey, the 13-month-old girl who is the world's youngest heart transplant patient, was reported a bit better today after a second operation. Hollie got her new heart Monday, and yesterday her doctors operated again to repair a hole in her intestines. Here is a report from James Wilkinson of the BBC.

JAMES WILKINSON, BBC [voice-over]: After her operation yesterday to repair a perforated bowel, Hollie Roffey is slightly improved through still very ill. She's on a ventilator and is being fed intravenously. The doctors are using the new drug called cyclosporin to prevent rejection of the heart. It has proved very successful with heart transplants in adult patients. Flowers from well-wishers show how Hollie's plight has aroused the public's sympathy.

TOM COSGROVE, hospital administrator: The baby has improved overnight. She remained stable. The heart seemed to stand up to the surgery, to the operation on her abdomen last evening. And this afternoon, I can report to the media, there's been no real change since this morning. So she still is holding her own.

HUNTER-GAULT: The baby's doctors say their main concern now is that she was not infected because of the hole in her intestine.

[Video postcard -- Fidalgo Island, Washington]

HUNTER-GAULT: In Warsaw the official Polish news agency agency said today the United States has decided to drop two of the sanctions that were imposed when Poland declared martial law in 1981. Sources in Washington said the American announcement will be made tomorrow.The Polish news agency said the United States will remove an order forbidding scientific and cultural exchanges and will restore American landing rights for the Polish national airline. That will leave two important sanctions still in effect: denial of new financial credit to Poland and cancellation of its privilege of equal treatment in trade matters.The United States has been expected to remove some sanctions because the Poles recently freed several hundred political prisoners under a general amnesty.

Jim? Athletes & Drugs

LEHRER: Tomorrow opens what is often called the most glamorous part of the Olympic Games, the track and field events. But the amateur athletes who do the sprinting, jumping and throwing in these events are also the ones most linked to the use of the illegal drugs. Last year at the Pan Am Games, for instance, 11 athletes, including two Americans, were tossed out of the Games after failing drug tests and others left to avoid being tested. Our Olympic special correspondent Larry Merchant has taken a look at the drug problem: why athletes use them, what is being done in Los Angeles to stop them.

LARRY MERCHANT [voice-over]: Before these Olympics are over, doctors and technicians at the Dope Control Center of the Los Angeles Games will have examined urine samples from more than a thousand athletes, medalists and nonmedalists alike, to determine the presence of banned drugs. But the drugs that are principally on everyone's mind are these: anabolic steroids, drugs derived from the male hormone testosterone. Normally, steroids are prescribed for sick or elderly people who need help regaining weight or strength.But athletes who take steroids claim they allow them to train longer and harder as well as to increase their muscle size. Olympic officials are concerned that these drugs not only give those who use them an unfair advantage, but also by the adverse effect that long-term abuse of the drugs can have on athletes. Bob Goldman is a medical student and weightlifter. Inspired by the death of a weightlifter friend who used steroids, he began researching steroid abuse, much of which is contained in his new book, Death in the Locker Room.

BOB GOLDMAN, author, "Death in the Locker Room": There have been a number of clinical studies where patients were given anabolic steroids for diseases, and many of them developed liver cancer. There's direct linking with anabolic steroids and liver cancer, other forms of cancer, problems with the prostate.

MERCHANT [voice-over]: Just last week, the Journal of the American Medical Association published a study documenting the negative effects anabolic steroids have on the heart: increase in cholesterol and the possibility of hardening of the arteries. But despite this mounting evidence, American and other world athletes have not stopped using steroids.

Mr. GOLDMAN: You can't scare athletes out of using these drugs. It's somebody else that's going to get sick, it won't be them, it's never them. And if it happens to them, all their friends go, "Well, it was just a freak accident, it'll never happen to me." I interviewed 198 world-class athletes. I said if I had a drug that would make you in everything for five years but -- one small catch -- at the end of five years it would kill you, 52% said yes. Now, when you have a 16-year-old kid who says it's okay if I die when I'm 21 if I can win a gold medal, you have a very serious psychological mind-set you absolutely must address.

MERCHANT: An adult sense of mortality usually is no match for a youth's heady visions of immortality. So, out of fear and/or ambition, world-class athletes continue to experiment with steroids and other elixirs. Al Oerter, a four-time gold medalist in the discus, as immortal as one gets in the Olympics, deplores this win-at-all-costs excess.

[interviewing] Al, is the use of steroids as widespread as many people have been led to believe?

AL OERTER, former Olympic medalist: I believe it is. When I came back into the sport in 1976 there was a great difference from the time I left in 1968. In '68, even though there was steroid use, it was still the concept on the part of the athlete that you worked hard.And when I came back in in 1976, if you did well, the perception on the part of many athletes was that I wonder what kind of chemical pill this gal or guy is on to increase distance thrown or reduce time run or something like that. It's a problem, and I just don't think we're doing enough to combat it.

MERCHANT [voice-over]: While Oerter sees steroid use as a serious problem that must be dealt with, Dr. Robert Kerr takes another stand, claiming that they are useful to athletes and relatively safe. Dr. Kerr has built his practice on prescribing steroids to athletes.

[interviewing] If you prescribe these drugs or steroids for athletes, aren't you in effect saying to all athletes, if you want to compete on the world level, you must take steroids?

Dr. ROBERT KERR, sports medicine physician: I don't have to say that; the coaches do. You know, I see athletes who won gold medals practically 40 years ago in competition. They took the steroids then, they tell me: they've taken them since; they take them now, because they're in senior competition. To them, this is a laughable situation. They've been doing this for 40 years, 30 years, whatever, and this is just a way of life with certain types of athletes, and they think this is ridiculous to spend so much time in discussing this issue that is an everyday phenomenon in certain aspects of athletics.

MERCHANT [voice-over]: Kerr maintains that the Communist countries are the worst offenders of all, and that their heavy use of drugs forces American athletes to play catchup to remain competitive.

Dr. KERR: One of our track coaches here in the United States not too long ago was talking to three Cuban track coaches, and they said that in Cuba, and as far as they knew, in the other Eastern-bloc countries, as an athlete you either take anabolic drugs or you don't compete.

MERCHANT [voice-over]: Dr. Arnold Beckett is with the International Olympic Medical Committee. He admits the Communist countries use drugs, but he claims they are attempting to control their abuses.

Dr. ARNOLD BECKETT, International Olympic Commitee Medical Commission: Now, it is my firm conviction, based upon a lot of discussions, that the Communist countries are equally concerned as the European countries are about the misuse of drugs in their sports. There's no doubt about that. And each country's saying the same: "Look, we have got to do this because there are other countries doing that." And they're competitive -- we've got to do it because the competitive country X is doing it. And so someone's got to break this chain.

MERCHANT [voice-over]: In fact, Dr. Beckett says that the United States has been a worse offender than the Communist nations.

Dr. BECKETT: The U.S., to be frank, has disappointed us over the years. Now, will the U.S. nowmove forward? It's got a lab here in Los Angeles. I hope it will continue to make use of this once the Games are over. Because we do need U.S. in this situation.

MERCHANT [voice-over]: To reverse the tide of steroid abuse, the International Olympic Committee began testing for steroids at the 1976 Games. Several athletes, including two American weightlifters, tested positive. At the 1983 Pan Am Games, Jeff Michels, an American weightlifer, was one of many athletes who came up positive for drugs. But his teammater, Guy Carlton, like may athletes, wonders how accurate the tests truly are.

GUY CARLTON, U.S. weightlifer: What happened to Jeff Michels has been a terrible injustice. I think this test, the bugs haven't been ironed out on certain athletes. From one day to the next they can turn up positive to negative to positive to negative, that there's something wrong with this test.

MERCHANT [voice-over]: Dr. Robert Leach is the head physician for the U.S. Olympic team.

Dr. ROBERT LEACH, head physician, U.S. Olympic team: The chances that a mistake would be made are very very minuscule. The problem when you have someone who tells you I haven't taken it and I'm taking something else, could that do it -- you always like to believe the athlete's right. And yet we know that some athletes have been caught. Sometime they disagree with the test, but we have to go with the test.

MERCHANT [voice-over]: But even as the International Olympic Committee tries to stop steroid abuse through stricter testing, a new drug, a substitute, has entered the picture: human growth hormone, or HGH. Dr. Kerr says that his athlete patients who take the drug are very pleased.

Dr. KERR: Well, it works very well, I'll put it that way. I've seen very few cases, very few cases of experiences athletes taking this drug and not achieving a great deal of growth in muscle tissue. Now, in my practice, roughly in the male -- in the men, roughly one out of six grows taller.

MERCHANT [voice-over]: The drug has one other benefit: there are no tests for it as yet, so it's perfectly legal.

Dr. BECKETT: Human growth hormone represents a problem, a serious problem. Now, the reason why there's not a test at this point in time is, normally before we plan for Olympic Games, there needs to be a period before those Games during which time we notify the various countries and federations, etcetera, of what is going to be controlled. Now, quite honestly I'm not happy with this situation. I believe we should have the flexibility, because if we cannot act quickly on a new problem as it develops, then in fact we're going to have the whole of our testing circumvented by the changes.

MERCHANT [voice-over]: For Dr. Kerr and the many coaches and athletes who feel that the use of performance-enhancing drugs is just another technical breathrough, the continuing effort to ban seems quixotic at best, futile at worst.

Dr. KERR: I think all of us would like to believe that our athletes, no matter whether they're baseball players or track and field, are that fair-haired American youngster who eats apple pie and who wouldn't think of cheating on anybody. Well, that athlete is that way. He might not smoke, he might not drink, he certainly might not take alcohol or narcotics, but he might take an anabolic drug if he thinks it might improve his performance.And is he any less of a champion? Well, I don't think so.

Mr. OERTER: I just can't believe people are that stupid. I would hope that people would look at chemical input in a very realistic fashion and realize that perhaps they're harming themselves over the next 80 years of their lives or something. It's -- I'm not 20 years old; I'm 47, and perhaps I think about things a little bit differently. But you know, a good life is a good life; it's beyond your 25th birthday, right?

LEHRER: So far the drug testing at the Olympic Games has apparently worked as a deterrent. Last week two Canadian weightlifters failed drug-control tests. They were sent home by the Canadian Olympic Association. Dr. Beckett told us he expects after the Games are over only a few athletes will have tested positive for drugs. Today, however, Olympic officials did announce that a Japanese volleyball player did test positive for ephedrine, a drug used as a stimulant.

Charlayne?

HUNTER-GAULT: Looking back over today's top stories, the Nuclear Regulatory Commission gave Diablo Canyon permission to operate at 100% capacity after a long and heated debate.

The airplane hijacking is over in Iran, and all the hostages are safe and sound.

The number of poor people in America has increased by 868,000.

The postmaster general threatened to fire postal workers if they strike.

And the stock market closed up 31.47 points, its biggest one-day gain in nearly two years.

Finally tonight, a story about quilts, rugs, clocks, gates, items normally considered strictly utilitarian objects. They can be looked at in a different way, however, as we see in his next report by producer Berry Richards of public station KTCA in Minneapolis-St. Paul. American Folk Art

BERRY RICHARDS [voice-over]: Last month the American public was given its first opportunity to see the largest collection of native folk art ever to tour this country. Organized by the Museum of American Folk Art in New York and now on view at the Minneapolis Institute of Arts, the exhibit is billed as a celebration of the art of the common man. Many of the objects on display were loaned by private collectors and won't be exhibited publicly again for years to come. Our tour guide is Minneapolis Art Institute director Sam Sachs.

SAMUEL SACHS II, director, Minneapolis Institute of Arts: Folk art is us. It is what we are about, what we were about, and it still remains and retains its fascination throughout all time; it is still being produced today.

RICHARDS: What about this painting? What makes this folk art?

Mr. SACHS: This is folk art done really by an itinerant artist, somebody who turned up at your house, walked down the drive and said, "How would you like to have your children painted?" This was obviously painted, I would guess, anyway, by an artist who appeared when father was away, because father was a sea captain and . . .

RICHARDS [voice-over]: The 19th century artist who unknowingly immortalized this little girl was typical of folk artists in an important way. He was untrained, untutored in the techniques of the professional artist, but as is clear from his unmistakable sense of color and design, untrained is not the same as unsophisticated.

Mr. SACHS: I think it's a mistake to think of folk art as being unsophisticated. You will find many really highly sophisticated, although simultaneously naive, works, and they fall into the realm of art primarily because of their expressive power.

RICHARDS [voice-over]: The exhibit contains more than 100 objects: furniture, fishing lures, religious symbols, knickknacks and much more. Simple artifacts from ordinary lives spanning three centuries. Their makers for the most part didn't consider themselves artists.They worked at their crafts for the joy of it, but also because they needed things.

Mr. SACHS: Remember that in looking at folk arts, that many of these objects were used. They had a utilitarian purpose. Well, if you're going to have to make a quilt to stay warm with, why not make it beautiful? If you're going to have to spend a lot of time making it, make it dazzling.

RICHARDS [voice-over]: Perhaps because the objects are so personal, the exhibit has a rare quality, a connection between artists and observer that is almost tangible.

1st MAN: I think folk art is what we the common people do to sort of maybe be remembered by our families more than other people.

1st WOMAN: The tediousness with which people stuck with their craft and did things is something that I think is very foreign to a lot of Americans today in such a hustling bustling society. And that kind of craftsmanship is really impressive to me.

2nd MAN: What is it that forces people to express the ordinary things of life in such beauty? The quilt, you know, it's a beautiful thing and people want it that way. Here's something to tell how the wind is blowing. And they just outdo themselves, who express some inner artistic sense of love of beauty.

Mr. SACHS: This is considered one of the masterpieces of American folk art in that the stitching of this quilt top -- it was never turned into a finished quilt -- is considered to be among the finest anywhere. There are paper cutouts that were used to model the figures, and the pieces of fabric were traced along those cutouts. And it's interesting, because they have been preserved, but there is one for the woman, because they made the quilt presumably, and one for the man, because this is known as a bride's quilt. The picture of the man in the finished quilting is not there, and he either died in the Civil War, as is thought, or perhaps he just ran off and decided not to get married. In any event, that may explain why this was never turned into the finished product it was meant to be.

RICHARDS [voice-over]: It's a poignant story, made even more so when you look into the eyes of the woman believed to have made the bride's quilt. But folk art can raise the full range of human emotion, and the exhibit contains much humor, as seen in this Uncle Sam whirligig.

Mr. SACHS: This must have been on the American-Canadian border, and on one side is the American flag on this little contraption that he is riding or is attached to, who knows which, and on the other side is the Canadian flag. And it may well have been for a store or a bar, and this thing peddling away in the wind would attract customers crossing the border and knowing they they'd be welcome no matter which side they came from. There is a sense of whimsy, of wryness in the way certain objects or ideas are presented, and some of this has to do with the very same thing that the hand-hooked rugs have to do with. They are a reliever of boredom. And I think the aspect of humor that creeps into this says a great deal about the absence of humor in much of life, and that if you wanted to smile at something or you wanted to be amused by something, you had to create it yourself.

RICHARDS [voice-over]: American folk art. It's a celebration of diversity, created by people with different roots, living in different ages and experiencing different emotions, but it's also a celebration of a common spirit, a spirit which is uniquely American. "American Folk Art: Expressions of a New Spirit," will be on tour for two years, stopping in seven cities in the West and Midwest before returning to New York.

HUNTER-GAULT: Good night, Jim.

LEHRER: Good night, Charlayne. And we'll see you tomorrow night. I'm Jim Lehrer. Thank you and good night.